Recently, the news of the fare adjustment of several popular high-speed rail lines has attracted more attention. Many people have found that the fares of some routes will increase to varying degrees, and some will increase by about 20%.
On May 2, the official website of Railway 12306 issued four price adjustment announcements. According to the announcement, since June 15 this year, the announced fares of EMU trains running at speeds of 300 kilometers per hour and above on the Wuhan-Guangzhou section of the Beijing-Guangzhou high-speed railway, the Shanghai-Kunming high-speed railway, the Shanghai-Kunming high-speed railway, and the Hangzhou-Ningbo section of the Hangzhou-Shenzhen railway, that is, the full-price ticket price without discount, will be optimized and adjusted.
Judging from the published fare schedules, some of the adjusted published fares are higher than the current fares. Taking the Wuguang section of the Beijing-Guangzhou high-speed railway as an example, the announced fare for the second-class seat from Changsha to Guangzhou South will be 377 yuan from June 15, 2024, an increase of 20.06% from the current announced fare of 314 yuan.
For example, in the Shanghai-Hangzhou section of the Shanghai-Kunming high-speed railway, the announced fare of the second-class seat from Shanghai Hongqiao to Hangzhou East has been increased to 87 yuan, an increase of 19.18% compared with the current published fare of 73 yuan.
In the announcement, the railway company also said that the implementation of fares between stations will be the upper limit of the published fare, with a lower limit of 5.5% off, and a floating fare system with multi-grade and flexible discounts will be implemented to provide more choices for passengers.
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How is high-speed rail priced?
How is high-speed rail priced? Before 2016, it was centrally managed by the state, and was mainly measured and formulated on the basis of construction and operating costs.
In 2007, the former Ministry of Railways issued a notice, clearly stipulating that the benchmark price of soft seat fares for EMU trains is 0.3366 yuan per kilometer for first-class seats and 0.2805 yuan for second-class seats, which can fluctuate by 10%. The pricing of high-speed rail refers to the pricing of EMUs, and also takes into account factors such as construction costs and market demand, and the fare of high-speed rail is generally higher than that of ordinary EMUs. In addition, the pricing of high-speed rail follows the principle of decreasing distance, that is, the longer the mileage, the lower the average freight rate. In February 2016, the National Development and Reform Commission (NDRC) issued the Notice on Reforming and Improving the Passenger Fare Policy for High-Speed Rail EMUs, which allows railway transport companies to set their own prices for high-speed rail bullet trains.
So what are the main considerations for the adjustment of high-speed rail fares? Why did you choose these lines for adjustment this time? Hear from the experts.
Li Hongchang, Researcher of the Sustainable Transportation Innovation Center and Deputy Dean of the School of Economics and Management of Beijing Jiaotong University: The adjustment of high-speed rail fares should consider the impact of comprehensive factors such as high-speed rail market demand, high-speed rail transportation supply capacity, financial balance of the railway system, and market competition.
- From the perspective of high-speed rail market demand, where the market demand is relatively strong, the proportion of business passengers is relatively high, and the ability of passengers to pay is strong, more flexible and diverse ticket prices can be carried out.
- From the perspective of high-speed rail transportation supply capacity, for high-speed rail supply capacity is relatively tight, especially for Beijing-Shanghai, Beijing-Guangzhou, Beijing-Harbin and other busy trunk lines, in order to better allocate the scarce transportation capacity of the railway, it is also necessary to allocate the transportation capacity through the ticket system and fare. The allocation of transport capacity is not only a process of distribution for passengers, but also a process of allocation of capacity for different railway transport enterprises within the railway.
- The financial balance of the railway system. Railways are under tremendous pressure to repay their debts. Through the ticket system, the overall income of the railway can be continuously increased. This can form a balancing mechanism for the financial balance of the railway.
- It is necessary to consider the market competition factors of the railway, especially the railway is facing the competition of civil aviation and highway transportation modes, and to meet the development needs of the comprehensive transportation system, it also needs to be adjusted through the ticket system and fare.
Based on the above reasons, this is also an important reason to choose these lines. The market demand for long trunk lines is strong, and the supply capacity of high-speed rail is relatively tight. For the railway transportation system, the financial compensation ability is strong, and the market competition is relatively fierce, so such a flexible ticket system can be adopted.
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Passenger traffic is growing rapidly
Last year, railway revenue and profit both increased
Unlike road transport and air transport, the state investment is quite large, and the distribution of profitable routes is also very uneven due to the influence of the regional economy. The recent rapid growth of passenger traffic has also brought good revenue and profits to the railway.
In recent times, railway passenger traffic has repeatedly broken historical records. In 2023, China Railway Group will complete the dispatch of 3.68 billion passengers, more than doubling year-on-year. During the past "May Day" holiday, the number of passengers sent by the railway in a single day continued to remain above 16 million, of which on May 1, the number of passengers sent reached 20.691 million, setting a record high in the number of passengers sent in a single day.
On April 30, China Railway Group released its 2023 annual financial accounts, and in 2023, China Railway Group will achieve operating income of 1,245.4 billion yuan, a year-on-year increase of 10.5%, and a net profit of 3.3 billion yuan, breaking through the 3 billion yuan mark for the first time.
So what is the current situation of high-speed rail operation and state subsidies in different regions of the mainland? What else will happen to high-speed rail fares in the long term?
Li Hongchang, Researcher of the Sustainable Transportation Innovation Center and Deputy Dean of the School of Economics and Management, Beijing Jiaotong University: Because railways have a very strong public welfare, the state's financial subsidies are a normal problem, which is a common trend at home and abroad. As far as high-speed railways are concerned, if we consider the high-speed railway network of four vertical and four horizontal, the amount of state subsidies must be deterministic and decreasing. If we consider the high-speed rail network with eight vertical and eight horizontal, due to the continuous improvement of the public welfare level of high-speed rail projects, then under the debt development model, the state subsidies will continue to increase. However, the railway freight transportation and the four-vertical and four-horizontal high-speed rail network, due to their strong profit-making, can carry out cross-subsidy within the railway, thus reducing the amount and level of national subsidies in general.
Generally speaking, high-speed railways connecting major urban agglomerations in mainland China are more likely to be profitable due to the strong demand for actual or potential passenger flows. At present, China's Beijing-Shanghai high-speed railway, Beijing-Tianjin intercity, and Beijing-Guangzhou high-speed railway are all profitable. For other high-speed rail lines connecting major urban agglomerations and regional urban agglomerations on the mainland, with the continuous increase of the mainland's income level and the continuous cultivation of passenger flow, it will also have the ability to make profits in the future.
The continuous marketization of high-speed rail ticket prices is the basic trend. There will be a trend of rising and falling fares of high-speed rail, which is the inherent need of high-speed rail revenue management. Due to the continuous increase in costs, raw materials, power, etc., under the condition of cost push, the adjustment of high-speed rail fares is also a long-term development trend. Of course, in the reality of the mainland, in the process of railway development, a large number of debt financing methods for development such an internal background also make the cost of internal pressure to repay principal and interest.
Source: Sichuan News Network